Apple's Media Tablet Will Beat Netbooks, Kindle

Companies like Amazon, Asus, and Apple are having some success selling small, portable gadgets used for reading the Internet, typing notes, listening to music, playing casual games, or in some specialized cases, watching movies or reading books.

The iPod touch is a solid, if too small portable computer, and it's selling very well -- 16 million sold since launching in late 2007.

And the Kindle -- now Amazon's top 2 best-selling electronics -- is doing a fine job as a specialized device for wealthy bookworms. Amazon could sell 1 million Kindles this year.

But we still think the ultra-portable computing market is going to be led by a well-designed, all-purpose gadget that's good at Web, reading, multimedia, and some games. Bigger than the iPod touch, a bit smaller than the Kindle DX, and not as cramped as a netbook. And we haven't seen that yet.